The IFCM MicroCap strategy is for accredited investors only who share our objectives, values, and timeframes. We also seek to partner with other Registered Investment Advisers (RIA) who are looking to provide their clients with intelligent exposure to the smaller half of the microcap ecosystem.

You can find the definition of accredited investor put forth by the SEC in Rule 501 of Regulation D Here. In general, it means you need to meet one of the following criteria:
- Annual income above $200,000, or $300,000 combined with your spouse
[or] Net worth of $1,000,000 – calculated excluding your home or any mortgage on it

Structure and Fees

1What is a Separately Managed Account (SMA)?

A separately managed account is an account set up at Interactive Brokers in your own name (or your entity name) that we manage on your behalf. You can log-in at any time. You own the individual securities in the account. It’s your account. We just manage it.

2Why Interactive Brokers?

Interactive Brokers is our broker. Interactive Brokers has historically offered the best execution at the lowest commissions in the brokerage industry. Interactive Brokers also has one of the highest S&P credit ratings in the financial industry. In addition, IFCM customer accounts at Interactive Brokers are protected by SIPC for a maximum coverage of $500,000 and up to an additional $30 million under Interactive Brokers excess SIPC policy with Lloyd’s of London. More Information

First, SMA allows us to tailor a strategy to the client instead of tailoring the client to the strategy. Each account will be allocated differently based on the valuations of companies available to us at the time a client is onboarded.
Second, the low-cost flexibility and transparency of SMA matches our objectives. The cost effectiveness affords us the time to scale slowly. Once the strategy hits full capacity we may look to reposition the strategy into a private fund.

4Why do you have a maximum initial investment?

We are investing in small illiquid microcaps. It is important that our strategy is diversified across a variety of investors as well as investment be capped. This limits the risk of one single investor potentially influencing the market good or bad, in the illiquid securities we hold. As we gain your trust and comfort, we will open up additional capacity for current investors before we open to new investors.

5What fees do you charge?

We charge a 1.92% annual management fee that is deducted each month (1/12 of 1.92%) based on the account value at the end of each month.

6Why don’t you charge a performance fee?

In a separately managed account structure we have found it isn’t tax efficient for the client or adviser to charge a performance fee.

7Who pays trading commissions?

The client pays trading commissions. We estimate initial trading commissions will be in the range of $200-$300 per $100,000 deployed. This range is based on a potential equity mix between lower priced equities and international equities which have higher commissions. The ongoing annual trading commissions could be less or more based on turnover.

8Do you have a lockup?

We ask for a 15 business-day written notice for any request for cash withdrawal or liquidation. Why such a short lockup? We are cautious with who we onboard as clients. We hope all investors view their investment in our strategy as quasi-permanent capital, but we also don’t want investors trapped.

9Will every client account be allocated the same?

No. Each client will be allocated differently based on the valuations of the companies in our opportunity set at the time of onboarding a client. Each account is tailored to the client.

Miscellaneous

1How many stocks will you own?

The IFCM MicroCap Strategy will own between 5-20 individual positions.

2Will you be having an annual IFCM investor event?

Yes. We will most likely have an annual event in Lancaster, Pennsylvania.

I’m interested. What are the next steps?

Let’s have a conversation. If we find the strategy fits your temperament and investment objectives we can move forward with setting up your account.